Non-Compete Agreements with Employees

by Vanessa Máire Griffith, Vinson & Elkins LLP, with updates by Practical Law Labor & Employment

A Practice Note providing an overview of non-compete agreements between employers and employees, examining their crucial role in safeguarding valuable corporate assets such as trade secrets, proprietary information, and goodwill. This Note discusses the complex legal landscape of these agreements, which traditionally depends on varying state laws, and highlights the evolving trend towards greater restrictions on their enforceability, including recent federal efforts to regulate their use. It explores the benefits and limitations of non-competes, critical issues to assess when drafting these restrictive covenants, and strategic considerations for their enforcement. This Note also discusses alternative legal protections available to employers, offering essential insights for navigating this dynamic area of employment law and protecting business interests. This Note contains general information and is jurisdiction-neutral. For information on state law requirements, see Non-Compete Laws: State Q&A Tool and State Restrictive Covenants Toolkit. For information on non-competes in the health care industry, see Health Care Non-Compete State Law Chart: Overview. For a 50-state comparison of non-compete laws and requirements generally, see Quick Compare Chart, State Non-Compete Laws.